When using least squares to estimate a model with a censored dependent variable,the results are
A)biased and inconsistent
B)unbiased,but not minimum variance
C)unbiased and consistent
D)biased but consistent

Question

Quizplus · Accepted Answer

Least squares estimation in the presence of a censored dependent variable leads to biased and inconsistent estimates because the censored observations do not provide full information about the dependent variable, violating the assumptions necessary for the least squares method to produce unbiased and consistent estimates.

When Using Least Squares to Estimate a Model with a Censored